Cost of City Living: East Coast v West Coast

Living in cities on either coast of the United States these days is beginning to get unreasonably expensive. Even in up-and-coming cities like Atlanta, cost of living is consistently increasing faster than the average salary. As a result, individuals and families in expensive cities are looking to their options within and beyond the region they’re currently living in, trying to see where their dollars can stretch the furthest.

If your desire is to live and work in or around one of the major East or West Coast cities, you’re probably contemplating the ideal place to start looking for a new job. So which of the two regions is the more expensive one? It depends on a few variables, including the cost of consumer goods (groceries, movie tickets, etc…), housing and rental prices, taxes, healthcare, transportation, and more. These numbers tell a story of just how far a specific salary figure will get you in any city.

Here are a few variables to consider when deciding on East vs. West, and where you’ll end up saving the most money. Remember, our comparisons are being made in absolute dollars, and not in consideration that you might get different salary offers from employers in different regions.

Rental costs

If you’re single, younger, or less than confident in the housing market, you might consider renting as the best option. In this case, when it comes to renting a one-bedroom apartment, most West Coast cities will cost you a good deal more. The median price tends to be more expensive on the West Coast, with San Francisco coming in at $700 a month more expensive than New York. Specifically, renting a one-bedroom apartment in New York, on average, will set you back $3100, compared to $3800 in San Francisco. This varies from area to area and by apartment size, but the general trend shows that San Francisco is the bigger monetary setback.

Comparing apartments in high-demand neighborhoods in Seattle and Philadelphia tells a clearer story of rental cost differences between East and West. Zillow data shows that in Philadelphia’s trendy, young neighborhood of Brewerytown, you can find a one-bedroom, one-bathroom, ~1000 square foot apartment for around $1200 a month. That compares favorably to Seattle’s Capitol Hill, which clocks in on average at $1800 a month.

So while renting in New York may cost you an arm and a leg, Philadelphia offers a good alternative that lets you live in a big city without breaking the bank. Seattle is a viable alternative to the even more expensive San Francisco, though it still doesn't fare well to the comparable cities on the East Coast, which generally win. But if the West Coast is your jam, consider all your options.

Housing prices

How much it costs to own a home/apartment is an important indicator to how much it will cost for you to live in an area. The median price of homes sold in Manhattan, according to Zillow, is $837,000, and Brooklyn comes in at $569,000. This compares well to San Francisco’s $1,128,000 median price. Oakland, a popular destination for people who are either priced out of the San Francisco housing market or looking to decrease costs, matches up evenly with Brooklyn.

But when you look at other East Coast cities like Atlanta, Philadelphia, and Boston - coming in well below $300,000 - you can begin to see a big disparity between them and some of the other smaller cities on the West Coast. San Diego, Los Angeles, and Seattle all clock in above $500,000.

This is all to say that while homes and apartments in New York and San Francisco are rather pricey, smaller but equally viable cities on the East Coast tend to be much more affordable than their West Coast counterparts. It’s important to note that this doesn’t take into account surrounding suburbs, but is good information if you’re looking to buy a home directly in one of these cities. Pair this with information on your potential commute in any of these locations and you’ll have a clearer picture as to how it might impact your quality of life.

Necessities

Another important factor to consider when looking at what cities are most affordable on each coast is how much necessities will run you, like groceries and utilities. According to Numbeo, which gathers both self-reported and independently gathered data on consumer prices, a gallon of milk in New York will hit your wallet hard, coming in at a couple of cents over $4. Compared to San Francisco’s $4.99 gallon, however, that seems like a steal. And this is the case across the board, with most staple foods running between 15-20% cheaper in New York. San Francisco does have a couple of big wins to its name - transportation and utilities. A month’s worth of public transit rides will cost you $70 compared to New York’s $120, and utility costs run 10% cheaper. Keep in mind, though, that transportation in New York gets you farther away, faster.

Aside from the two behemoths, you can still see the East Coast’s advantage. For example, compared to Seattle, eastern cities Atlanta and Philadelphia see lower costs on food, transportation, utilities, and pretty much every other necessity. Further, these prices also shift to the lower end and become more affordable in New York’s surrounding suburbs, where your salary goes further than in the city. These prices fluctuate quickly and regularly as the market shifts, but if you’re trying to go for overall lower bills, the East Coast could be your ticket.

Life’s luxuries

Do you like to dine out? Another part of living in a city includes going out, eating at restaurants, drinking at bars, and the like. These luxuries of life are important parts to an enjoyable and affordable city life. Here, New York is slightly more expensive than San Francisco. If you eat out 3 days a week, you can expect to pay 20% more in New York, according to Numbeo. Depending on the type of food you like to eat, that can be at least a $40 bigger hit to your bottom line each month, or $480 over the course of a year.

Elsewhere, you find a more East Coast favorable pattern. Atlanta’s the most inexpensive choice by far, trumping Seattle, Los Angeles, and San Francisco with the lowest cost of almost all luxury items and services. Philadelphia will land you cheaper restaurant prices and cheaper gym memberships to complement all the extra food you’ll be eating. Though New York loses out to San Francisco, you’ll find you can save a good bit of cash out East and can even find surrounding neighborhoods in New York that keep you near the heart of the city without breaking the bank.

Taxes

State and local taxes are also a big part of life in a big city. On the East Coast, you’ll end up bearing a larger burden of taxes in New York and New Jersey, than in California or Washington. And while New York and California are considered among the highest-taxed states in the country, the difference between the two can amount to a large chunk of cash.

So what does that mean for your bottom line? In New York, the average state and local tax burden (which includes income, sales, property, gas, and any other local taxes) amounted to around 12.7% of income in 2015. Compared to California’s 11%, that’s may not seem like a massive difference in what you’ll end up paying each April, but on a $50,000 salary, it amounts to savings of $850 a year. A huge reason why people move out of New York and into New Jersey is because of their overall tax burden - even the Garden State’s 0.5% a year lower state and local tax burden is appealing when combined with a lower cost of living in other areas.

Salary distance

So at the end of the day, how far does a $50,000 salary get you in New York compared to San Francisco? The reality is that, in Manhattan, when taking into account taxes, housing, rent, and other cost of living adjustments, $50,000 a year will get you the same distance that $38,000 would in San Francisco. Brooklyn fares better, allowing you to run as far with that salary as you would in The Golden Gate City. But it’s important to consider that your cost of living in New York can be much more dynamic than San Francisco. San Francisco is housing constrained and not as dense in its metropolitan area. Combined with the fact that the surrounding suburbs are similarly expensive or limited, it’s a more options-limited place to live. Make sure that your salary will give you enough of a cushion to afford rising prices.

Take New York’s suburbs as an example of its flexibility. New Jersey is often seen as a cheaper, efficient alternative to living in the city. Jersey City, for example, has significantly lower rent and housing costs, and commuting into New York is just a quick subway ride. Burlingame and San Bruno, on the other hand, have rent prices in the upper $3000 range, according to Zillow, and are significantly further from downtown San Francisco. Overall, living in New Jersey or in a New York suburb like West Nyack will give you a lot more bang for your buck if you work in New York than living just outside but working inside of San Francisco.

Which is best?

The conclusion to draw here is twofold. First, New York City and San Francisco are the most expensive possible living choices on each coast. New York’s been this way for a long time, while the recent tech boom has turned San Francisco from a relatively affordable, artsy city into something much more akin to New York.

And while both cities are getting less and less affordable, San Francisco has been trending to become even more expensive lately, with lower income families being priced out of neighborhoods they’ve lived in for decades. The metropolitan area around San Francisco is also quite a bit less affordable than its New York counterpart, making it harder to live and work on a smaller salary in surrounding neighborhoods.

Second, you have viable alternatives to the expensive behemoths on either coast. Philadelphia and Atlanta on the East Coast mark two growing and inexpensive cities that you can consider. Seattle and Los Angeles are significantly less expensive than San Francisco and can be great options to continue your career. Further, the lower California tax rate compared to New York and New Jersey can be a highly attractive draw to move to an affordable city in the Golden State.

Overall, purely in terms of cost of living in absolute dollars, in cities both large and small, you’ll find more affordable options on the East Coast. The same salary will get you further in a place like Philadelphia or the suburbs of New York than it would in Los Angeles or Seattle when considering what you’ll pay for housing, necessities, and luxuries.

However, with all of the above, you should also be comparing the salaries you’re being offered and the benefits that come with jobs in different locations. Use this knowledge to know that a $80,000 offer in San Francisco doesn’t get you as far as $80,000 in New York, but also know that a lot of employers are aware of cost of living differences and therefore adjust their offers appropriately. Be ready to make comparisons of all the factors that go into determining how much disposable income you’ll have at the end of the month.